Archive for February, 2010

A Spirit of Fear

February 26th, 2010

Here in Texas, the big political battle of the day is the Republican Gubernatorial Republican Primary between U.S. Senator Kay Bailey Hutchison and incumbent Governor Rick Perry.  The ads used by both parties insult my intelligence.  Just so you know where I’m coming from, here’s one from the Senator:


Whether it’s a political attack ad that lacks substance, or the 24-hour news network constantly trying to hook you into a story, this trend of negativity isn’t going anywhere soon.  Why?  Because fear sells.  Fear gets ratings.

Motivational speaker Tony Robbins often said that FEAR is an acronym for “False Evidence Appearing Real.” Once consumed by F.E.A.R., it leads you to make irrational choices, including in your financial life.  Here’s an examples of F.E.A.R.

Instance of F.E.A.R. — “I’m driving a 3 year-0ld minivan and have two kids.  I need a new van — I mean, I just couldn’t imagine being stuck on the side of the road with a broken down old car!  Besides, this new minivan has more safety features.  You don’t want our children to be in danger, do you?”

Reality – You rarely drive outside the city limits in the kid-toter.  Your minivan has plenty of room and is reasonably reliable.  Breaking down and needing a tow truck is not the end of the world, nor is it scary, especially with cell phones available to call for help.  There is no way the new minivan is THAT much safer to justify the extra cost.  Getting a brand new minivan with brand new payments upwards of $500-$600/month, just to avoid an off-chance instance of breaking down?  Illogical.  Don’t let F.E.A.R. dupe you into a financial hole that will take 36-72 months to pay off.

Beating F.E.A.R. Into Submission

For God has not given us a spirit of fear and timidity, but of power, love, and self-discipline. ~ 2 Timothy 1:7 (NLT)

F.E.A.R. so easily creeps into our consciousness.  How to we counter it?  Well God and the Apostle Paul are pretty good authorities, and they say the opposite of fear is power, love, and self-discipline.  Work on identifying when someone is playing on your fears.  Identification of F.E.A.R. is empowering. It allows you to compare it to your judgment and self-discipline to see how this F.E.A.R. should apply to your financial life.  When you have a financial plan (self-discipline), you will be empowered to make the right decisions by those habits, rather than reacting to F.E.A.R.


Can you identify any instances of F.E.A.R. in your life?  What self-disciplines have you used to overcome these F.E.A.R.s??  Meantime, early voting ends today — I’m off to go vote.

Follow me on Twitter.


Military Saves Week

February 24th, 2010

As I was so graciously reminded by Lakita from Personal Finance Journey, this week is “Military Saves Week.”

What is Military Saves Week?

Military Saves Week is a week used to raise awareness to military families of the need to develop and practice responsible financial habits.  According to, Military Saves is part of “America Saves,” a national campaign involving more than 1,000 non-profit, government, and corporate groups encouraging individuals and families to build personal wealth.

How Does It Work?

The premise behind the Military Saves initiative is simple:

Financial stability is about a lot more than knowledge — it takes consistent action over time. Most of us do better when we have a supportive environment.

Military servicemembers and their families are encouraged to head to the Military Saves website, and take “The Savers Pledge”.  After signing up, servicemembers will regularly receive newsletters and financial advice from an e-Wealth Coach via e-mail.  By joining an active community dedicated to the cause of financial responsibility, our military families will become a generation of savers.

The Savers Pledge:

I will help myself by saving money, reducing debt, and building wealth over time.

I will help my family and my country by encouraging other Americans to Build Wealth, Not Debt.

I’m Not Military, How Can I Help?

I’m sure there are numerous ways to help, but here are a few I can think of:

  1. Think Locally — Look within your family or neighborhood.  Is there a military family you know that could benefit from taking part in the Military Saves initiative?
  2. Volunteer — If you live near an active or reserve military base, offer to teach a Financial Peace University class for military members & their families.
  3. Build Community — The Saver’s Pledge officially appears to be for military only, but that doesn’t mean you can’t support their cause through social networking.  Join the Military Saves Facebook page, then spread the awareness by adding a status update.  Here’s two suggestions you can copy & paste:

Facebook:  Support Military Savers Week!  ”I will help myself by saving money, reducing debt, and building wealth over time.  I will help my family and my country by encouraging other Americans to Build Wealth, Not Debt.” — Pass it on!

Twitter:  I stand with the U.S. Military during Military Savers Week. – Take the Saver’s Pledge & RT!

Final Thoughts

Many of our servicemembers are in their teens and early 20’s.  They are given huge signing bonuses which are often blown on the first motorcycle dealership near the base.  Spouses are left alone for months with children and without a financial plan while the other spouse is serving abroad in war.  Financial instability is one of the biggest security risks to our military. The outskirts of military bases are scattered with payday loan businesses that clearly target our young military.  They prey upon them to make horrible financial and personal decisions.  This is how we can fight back. Support your military and give them the financial tools to have success down the road.  It’s the least we can do.

Follow me on Twitter


Tax Refunds: Does Size Matter?

February 22nd, 2010

Taxes have been filed, and a refund has arrived in the MyMoneyMinute household to the tune of about $360.  Last year, we were hit with about a $2,000 tax bill, so I was pleasantly surprised to end up on the receiving side this time around… but should I be?

Money Experts: “You Don’t Want A Big Refund!”

Many financial experts, including Dave Ramsey, frown upon a big tax refund.  Why?  Because the money you’re getting back was yours in the first place — it’s just been held hostage by the government for a year, interest free! The solution for them is to adjust your income tax withholding on your paycheck so that you receive more money each pay period.  Additionally, if you receive a larger lump-sum return, you’re more likely to spend it on a big-ticket item (electronics, vacation, etc.) rather than use it in a more financially responsible way, like paying off a car loan or credit cards, building up an emergency fund, or even for extra giving to your local church ministries.

For more on this argument, read articles by these two great bloggers:

Craig Ford from Bible Money Matters – 3 Reasons Why A Big Income Tax Refund Is A Horrible Thing.

Jason Price from One Money DesignIncome Tax Refund: Is It Good Or Bad?

Me: “It’s Not So Cut & Dry”

In an ideal world, I agree with the guys above.  Unfortunately we don’t live in an ideal world.  If I lived in an ideal world, I’d never owe taxes or get a refund.  Then again, I also would never have charged money on a credit card, financed my life (cars, furniture, a home, and an education that cost even more than the home!).  Oh, and I’d have a stable job, an ideal salary, with predictable raises and bonuses too.

The 2 Major Reasons To Tolerate A Big Tax Refund

While aspiring for the ideal scenario above, there are reasons a big tax refund isn’t such a horrible thing after all.  Here are a few of them:

1.  You Suck With Money

Let’s face it.  If, instead of getting a big chunk of money in a refund each year, you got monthly slices of it by altering your withholding, it is almost guaranteed that money would be spent, and you wouldn’t even know where it went.  A few extra bucks each paycheck would be swallowed up by a restaurant here and a Starbucks trip there.  When you get one big check after tax season each year, you only have to make one financial choice each year, not 12 monthly choices to do the financially smart thing.  And hey, even if you make the wrong choice and blow the entire refund, at least you’ll get a really cool big-ticket item out of the deal, rather than spending it all throughout the year and not knowing where it went. If you’re gonna be stupid with your money, at least get a TV or an all-inclusive vacation to show for it.

The majority of us are financially undisciplined.  Until you get disciplined, a big refund can protect you from… you.  For a great analogy of this argument, check out an article written by Sam at Financial SamuraiTax Refunds Are Good For Most People, Because Most People Can’t Save.

2.  The Danger of “Normal”: Risk Is Diminished

What my blogging friends didn’t discuss in this tax debate was this: we face problems adjusting our income withholdings because life is rarely “normal” or “ideal”.  Most people I know with a “stable” salary and tax structure are government employees.  In this economic climate, even those jobs aren’t safe.  People are underemployed and laid off in record numbers to the point where it is difficult to determine what your expected yearly withholdings should be.  Additionally, life happens too — you get married, buy a house, have children, buy a different house, someone gets injured on the job or gets pregnant — all these life changes affect your taxes, which means your withholdings may be off again.

For me, a limited return is ideal, but does not factor in the reality of risk.  From a risk standpoint, I’d much rather risk (1) giving the government my money interest-free for a year and get a big refund, rather than (2) miscalculate my withholdings and having to scramble to come up with an unexpected tax bill.


Currently, my life is just not stable enough to justify the risk of accidentally under-withholding to the point where I owe a big tax bill, and I suspect most people are in the same boat.  Perhaps down the road, life is a bit more stable and less in flux, I can spend the extra energy to get my withholdings down to a science.  But until then, I’ll err on the side of caution.

What Say You?

Don’t forget to read the articles by Craig, Jason, and Sam – then drop a comment below and let me know how you deal with your income withholding & tax refunds.

Follow me on Twitter

taxes , , , ,

The Credit Crisis Visualized

February 18th, 2010

Economics 101

After foreclosures, increased unemployment, and a recession, we all have at least some idea of the “Credit Crisis”, and how it continues to affect our lives.  But if you’re like me, then a little visual learning never hurts!

“The Crisis of Credit Visualized” is a video by Jonathan Jarvis, who has some great videos over at Vimeo.  Take a minute and look at this great compilation.  Thanks goes out to Kevin McGill, who originally posted this video for Koine Church, a church plant in Dallas, Texas.

The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.

Do You Agree?

Do you agree with Jonathan’s assessments? Would you explain the credit crunch any differently? Let me know in the comments below.

Follow me on Twitter


The Deadliest Catch: Should You Mortgage Your Health For Wealth?

February 10th, 2010

A Fisherman Has Passed, A Legend Is Born

Last week, confirmed reports began to surface that Phil Harris, Captain of the boat Cornelia Marie on the Discovery Channel’s reality show “The Deadliest Catch”, had passed away as a result of complications resulting from a stroke he suffered while crab fishing in the Bering Sea. Here’s a quick video on Capt. Phil and his love of fishing:

Health vs. Wealth

If you’ve seen The Deadliest Catch, you know the captains and their crews not only have a crazy-dangerous job, but also live a hard life. Capt. Phil was a notorious smoker. The only time he appeared to take his cigarette out of his mouth was to either light up another one, or down a Red Bull energy drink, which he purportedly consumed several cases each week!

Capt. Phil obviously loved fishing, and would probably have done it for free. But there’s no doubt that fishing earned him a decent living. Unfortunately, to earn that living required that he be gone from his family for months at a time, chain smoke, eat unhealthy, drink Red Bulls incessantly, be sedentary, and have horrible sleeping patterns.

Living, or Making a Living?

As a lawyer, I’ve seen countless times where work has come at great cost to a person’s health, both physically and mentally. The same, however, can be said for nearly every profession. Special care needs to be taken to ensure a proper balance is cast between work and health. But understandably, we will often mortgage short-term health for monetary gain. Maybe you take a second job to earn extra money to pay off some debt, like Jeff Kosola, who blogs at Deliver Away Debt.

4 Tips on Mortgaging Health for Wealth

  1. Set A Goal — If you must sacrifice your physical or mental health for career or money reasons, make sure you have specific, defined reasons for doing so. You want a second job to pay off debt. You will work an extra shift because you’re saving for a car. You’re putting in extra hours now so you will be in a better career position once your children are born (a little more general, and perhaps not a great reason unless a definite career plan is defined).
  2. Spouse Must Be On Board! — It’s hard enough as it is to get on the same page with your spouse financially. Don’t mess that up by making unilateral decisions that deprive you of family time. Both should be in agreement of the specific plan to sacrifice short-term health.
  3. Be Reasonable; Reassess — Be reasonable with your lofty plans. You want to work 100 hrs/week and working 3 extra jobs? Great! Just don’t realistically expect to keep that up for 5 years. The more hours you plan on being away from quality time with your family each week, the shorter your “Health Mortgage Term” should be. You should also reassess every so often to make sure the plan is still on-track, and if you still have one (LOL) that your spouse is still in agreement with the “Health Mortgage Term”.
  4. Refinance — If for any reason the above 3 reasons begin to crumble, it may be time to refinance that “Health Mortgage”. Perhaps shorten the term, or reduce the number of extra hours worked each week. Hopefully the closing costs aren’t too high!

What About You?

Have you, or are you considering, a “Health Mortgage”? What do you think about a “Health Mortgage”?? I’d love to hear your experience or theories in the comments below.

Follow me on Twitter!!

Health , , , ,

Sinners to Saints: What To Learn About Success

February 8th, 2010


When nothing seems to help, I go and look at a stonecutter hammering away at his rock perhaps a hundred times without as much as a crack showing in it. Yet at the hundred and first blow it will split in two, and I know it was not that blow that did it, but all that had gone before.



We Are The Champions

Congratulations to the New Orleans Saints on their victory in Super Bowl XLIV! The Crescent City and the State of Louisiana will be partying from now through Mardi Gras, celebrating their team’s victory over the Colts.

The celebration got me thinking about the successes in life. They often feel few and far between. Afterall, every year a Super Bowl celebration on one city means 31 other cities are left with some level of disappointment. So how should we view success and deal with the inevitable failure in life?

The Struggle

Before success comes the failures. How many times did you see video clips of Saints fans from 20 years ago, with paper bags over their heads proclaiming their consistently horrible team the “Aints” instead of the “Saints”? Thomas Edison failed thousands of times before hitting successfully on inventions that altered the history of the world. How many losing seasons have the Cubs endured; yet how satisfying will it be when they finally win the World Series? Just ask Red Sox fans.

What I learn from this, is that the greater amount of failure and hard work you put in, the more meaningful & satisfying the success.

The hard part is shifting your thinking to where you understand that failure is just part of the road on your way to success, not an end in itself. The best article I remember about embracing failure comes from my blogging buddy, Financial Samurai, in his post titled “You’re Rejected!”. When I’m struggling with setbacks, personally or professionally, it helps to read articles like this to keep proper perspective!

Share Success With Others

Funny commercials come and go. Millions of dollars were spent on promoting South Florida and the Super Bowl itself. But what is the lasting memory for me? Super Bowl MVP Drew Brees, nearly in tears, holding his infant son and reflecting on his journey that finally ended with a championship.

Success just isn’t the same unless you share it with others. Having a spouse, team, city, or even state behind you — walking with you through the pitfalls, laughing and crying with you through the journey, or working into the night with you to accomplish a goal — without such support the accomplishments are at best miniscule.

That reminds me — swing over to PT Money and congratulate PT, a Louisiana-native, on the Saints Super Bowl win.  It’s fun to share in others’ success, isn’t it?


So when you run up against one of life’s failures, remember it is a prerequisite to success. Like the quote above indicates, just keep pounding the rock. When the rock finally splits, you’ll have such a greater appreciation for your success when you recognize the previous blows that came before it.

Follow Me On Twitter

Personal Finance